Which of the following are regarded as financial instruments:
I Deposits held by a financial institution;
II Ordinary shares;
III Raw materials inventories;
IV Property, plant and equipment.
V Accounts receivable and accounts payable.
A) I, II, IV and V only;
B) II, III and IV only;
C) I, II and V only;
D) I, IV and V only.

Question

Which of the following are regarded as financial instruments: 
I Deposits held by a financial institution;
II Ordinary shares;
III Raw materials inventories;
IV Property, plant and equipment.
V Accounts receivable and accounts payable.
A) I, II, IV and V only;
B) II, III and IV only;
C) I, II and V only;
D) I, IV and V only.

Quizplus · Accepted Answer

Deposits held by a financial institution (I) and ordinary shares (II) are financial instruments as they are securities that represent a financial asset. Accounts receivable and accounts payable (V) are also financial instruments as they represent a credit or debt that is expected to be received or paid. Raw materials inventories (III) and property, plant, and equipment (IV) are not financial instruments as they are physical assets used in the production process.

Which of the Following Are Regarded as Financial Instruments